French engineering giant Alstom, the third-largest power plant maker in the world, is in deep trouble with the arrest of its former manager in a corruption and money-laundering probe in Switzerland by the Swiss police.
The Swiss government said in a statement, ''Police from the Federal Criminal Police and several French police officers carried out a series of house searches at various locations throughout Switzerland, including the offices of the Alstom AG in Baden."
The arrest and raid is related to suspected bribes worth tens of millions of euros made to officials or functionaries to secure tenders in Asia and South America between 1995 and 2003 by Alstom routed via Baden-based Alstom Prom A, which in some cases might have led to the awarding of contracts.
Alstom has confirmed the arrest but declined to shed any light on the ongoing investigations.
In May Swiss authorities found evidence of Alstom having paid 20 million euros (31 million dollars) to its marketing people working for it in Singapore, Indonesia, Venezuela and Brazil.
The French government also initiated an inquiry against the company following a tip received by Swiss authorities in November 2007.
In June French judges charged a former consultant for Alstom over suspected bribes paid for lucrative contracts.
Alstom is strongly suspected of paying 6.8 million dollars in order to win a 45-million-dollar contract for the Sao Paolo subway. Brazilian authorities started investigating the company for suspected tax avoidance and money laundering.
Alstom is a leading French industrial group which builds power stations and the TGV high-speed train with its presence in more than 70 countries worldwide and employs around 76 000 people.
Alstom was saved from bankruptcy in 2004 by state intervention orchestrated by President Nicolas Sarkozy who was the finance minister during that time.
In India, Alstom companies have a turnover of about Rs 940 crore, and employ about 2,600 people. It is a majority shareholder in Alstom Projects India Ltd.
Alstom group has won four major orders worth Rs 330 crore for equipment supplies and Renovation & Modernization (R&M) work on four power plants in India.
These orders were from National Thermal Power Corporation Limited (NTPC), TATA Power, NALCO and GEA Energy Systems (India) Ltd.
Alstom Projects India makes nuclear reactors and rotors. Alstom is a world leader in conventional nuclear projects. It makes turbines for nuclear power stations.